Correlation Between TTY Biopharm and Tang Eng
Can any of the company-specific risk be diversified away by investing in both TTY Biopharm and Tang Eng at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining TTY Biopharm and Tang Eng into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between TTY Biopharm Co and Tang Eng Iron, you can compare the effects of market volatilities on TTY Biopharm and Tang Eng and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in TTY Biopharm with a short position of Tang Eng. Check out your portfolio center. Please also check ongoing floating volatility patterns of TTY Biopharm and Tang Eng.
Diversification Opportunities for TTY Biopharm and Tang Eng
-0.11 | Correlation Coefficient |
Good diversification
The 3 months correlation between TTY and Tang is -0.11. Overlapping area represents the amount of risk that can be diversified away by holding TTY Biopharm Co and Tang Eng Iron in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Tang Eng Iron and TTY Biopharm is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on TTY Biopharm Co are associated (or correlated) with Tang Eng. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Tang Eng Iron has no effect on the direction of TTY Biopharm i.e., TTY Biopharm and Tang Eng go up and down completely randomly.
Pair Corralation between TTY Biopharm and Tang Eng
Assuming the 90 days trading horizon TTY Biopharm is expected to generate 1.83 times less return on investment than Tang Eng. But when comparing it to its historical volatility, TTY Biopharm Co is 1.77 times less risky than Tang Eng. It trades about 0.07 of its potential returns per unit of risk. Tang Eng Iron is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 3,280 in Tang Eng Iron on August 30, 2024 and sell it today you would earn a total of 40.00 from holding Tang Eng Iron or generate 1.22% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
TTY Biopharm Co vs. Tang Eng Iron
Performance |
| Timeline |
| TTY Biopharm |
| Tang Eng Iron |
TTY Biopharm and Tang Eng Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with TTY Biopharm and Tang Eng
The main advantage of trading using opposite TTY Biopharm and Tang Eng positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if TTY Biopharm position performs unexpectedly, Tang Eng can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Tang Eng will offset losses from the drop in Tang Eng's long position.| TTY Biopharm vs. Tehmag Foods | TTY Biopharm vs. Ibase Gaming | TTY Biopharm vs. Founding Construction Development | TTY Biopharm vs. Hunya Foods Co |
| Tang Eng vs. Goldsun Building Materials | Tang Eng vs. CKM Building Material | Tang Eng vs. Shih Kuen Plastics | Tang Eng vs. Taiwan Cooperative Financial |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Volatility module to check portfolio volatility and analyze historical return density to properly model market risk.
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